Yahoo! and OgilvyOne Worldwide “Selling Money” Research - Key Findings June 23, 2005
Financial Activities Shifting Online Monitoring Finances Has Become an Online Activity The Internet has become the leading medium for monitoring financial activities, which are the most frequently conducted activities across all stages of financial management. *Monitoring activities studied within this research included checking bank account balances, monitoring credit card activity and viewing investment portfolio balances. Frequent visits to the bank teller are a thing of the past: The majority of study participants indicated that the primary way they use to check their account was in-person (52 percent) followed by the telephone (25 percent). Today nearly two-thirds of respondents (64 percent) primarily check their balance online. No more waiting for the mail to learn how investments have performed: Sixty-two percent of respondents indicated that receiving statements via mail was previously the primary method of viewing investment portfolios. Today, 56 percent of respondents primarily check their investment portfolios online, while 32 percent rely on the portfolio records through the mail. Financial Management Has Shifted to the Internet Financial management activities have also experienced a shift from offline to online, with approximately the same percentage of respondents paying their bills online as they do through the mail. Additionally, the majority of respondents are now trading investments online. *Financial management activities examined in this study were paying bills and trading investments. Paying bills is no longer about stuffing envelopes and licking stamps: Paying bills was previously done primarily by mail or in-person (65 percent and 28 percent respectively), but today 43 percent of respondents currently pay their bills online, which is the same percentage of respondents who primarily pay by mail. Only ten percent of respondents indicated that they still pay their bills in-person. Trading investments no longer requires a visit to a broker: Trading investments (buying and selling) was historically done in-person (38 percent). Today half of all respondents indicated they primarily trade investments online, while only 15 percent of respondents still primarily trade investments in-person. The percentage of respondents who primarily trade investments over the phone has also increased, from 13 to 29 percent. Online Research Has Eliminated the Need for In-Person Shopping Research of investments and financial products has shifted from a largely in-person activity to an online activity. Nearly all financial research was previously done in-person or by mail, while this research is now conducted primarily online. The research activities examined in this study included the research of investments, bank accounts, loans, and credit cards. Bank account and loan research no longer means a trip to the bank: Researching bank accounts was historically done almost exclusively in-person, with 82 percent of respondents indicating that their primary method of research for bank accounts was in-person. o Today 61 percent of respondents conduct their bank account research primarily online. Additionally, 61 percent of respondents conducted research for loans primarily in-person when they first started the activity. o Loan research is most frequently conducted online with 53 percent of respondents conducting research for loans primarily on the Internet. Consumers have become their own investment advisors: Sixty-five percent of respondents previously researched investments primarily in-person. Today, 73 percent of respondents indicated that the Internet is the main method for researching investments. Credit card research is now more than opening junk mail: The majority of respondents (53 percent) indicated that information about credit cards was previously obtained primarily through the mail. This activity has shifted to the Internet, as 59 percent of respondents cited the Internet as their primary method for researching credit cards today. -MORE-
Financial Purchases Remain an In-Person Activity Although the use of the Internet for major financial purchases is on the rise, applying for a mortgage and purchasing an insurance policy remain primarily offline activities. However, applying for a credit card is now done mainly online. Consumers are still applying mortgages and insurance policies in-person: Although the majority of consumers (53 percent) conduct their research for loans online, applying for a loan remains an in-person activity. Eighty-three percent of respondents indicated that applying for a mortgage was done in-person the first time they conducted this activity. o In-person applications remain the primary method of applying for a mortgage now, with 56 percent of respondents citing in-person as their preferred method. Twenty-seven percent indicated that they applied for their mortgage online. o Insurance policies were previously purchased in-person by nearly three-quarters of respondents (71 percent). Today, the majority of respondents (51 percent) continue to purchase their insurance policies in-person. Only 18 percent of respondents purchase insurance policies online. Credit card applications have shifted to the Internet: Credit card applications were previously submitted primarily through the mail by 62 percent of respondents. This activity has seen a major shift to the Internet, with 44 percent of respondents citing the Internet as their foremost form of applying for credit cards. Thirty percent of respondents said they currently apply primarily through the mail.